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TMI Blog2013 (7) TMI 1028X X X X Extracts X X X X X X X X Extracts X X X X ..... being reacted as a dividend in computing income of assessee. The opening balance or loan taken in earlier year is not loan received by the assessee during the relevant previous year and could, therefore, be not treated as amount of loan or advance received by the assessee during the relevant previous year. Such amount, therefore, could not be included as deemed dividend under clause (e) of section 2(22) of the Act. In the case under consideration, since the loan amount is not issued during the year, therefore, we find that the CIT(A) has rightly deleted the addition. Addition on account of house hold expenses - Held that:- AO purely made estimated addition without bringing any material against the assessee for estimating household expenses. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Page 2, A.O.) Date Amount 02.11.2004 8,00,000/- 05.11.2004 8,00,000/- 29.11.2004 14,00,000/- Total 30,00,000/- 4. The A.O. after examining the conditions of section 2(22)(e) found that the main business of the Company is running of coaching classes and lending of money is not substantial part of business as per provisions of section 2(22)(e), therefore, the A.O. made addition of ₹ 18,90,581/-. The CIT(A) deleted the said addition as under :- (Paragraph no.4.2, page nos.7 & 8). "4.2 Appellant's submissions along with assessment order have been considered carefully. Assessment records have also been perused. The company viz. Mastermind Classes Pvt. Ltd. is engaged in diverse business activities which includes running ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n object, the money given by it by way of advance or loan to the director/share holder cannot be regarded as dividend, as it has to be excluded from the definition of dividend by virtue of clause (ii) of Section 2(22) of the I.T. Act. Further the transaction of loan/advance between the appellant and the company has taken place because of the fact of buy back of equity shares of the appellant by the Private Company. The appellant has produced all the details evidencing the buy back transaction in form of notice to shareholders by the private Company, Board's Resolutions duly signed share transfer deed etc. According to Sec.2(22)(iv) of the LT. Act, any payment by a company on purchase of its own shares from a shareholder u/s 77A does not amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of the voting power, or to any concern in which such shareholder is a member or partner and in which he has a substantial interest or any payment by any such company on behalf, or for the individual benefit, of any such shareholder, to the extent to which the company in either case possesses accumulated profits. Such payment by a company is deemed dividend as provided under section 2(22)(e) of the Act. The CIT(A) has decided the issue in favour of the assessee that the assessee has filed the return before the search and during the course of search no incriminating material was found. Further that the money lending is not substantial part of Company's business by applying provisions of section 2(22)(e). On perusal of A.O.'s order, we not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dend under clause (e) of section 2(22) of the Act. In the case under consideration, since the loan amount is not issued during the year, therefore, we find that the CIT(A) has rightly deleted the addition of ₹ 18,90,581/- not on the reasons mentioned by the CIT(A) but on the reasons and basis as stated above. 6. The second ground is pertaining to addition of ₹ 88,000/- on account of house hold expenses. 7. At the outset, the ld. Authorised Representative submitted that this issue is squarely covered by the order of I.T.A.T., Agra Bench in ITA Nos.155/Agra/2011 in the case of Shri Praveen Gupta vide order dated 23.03.2012. The relevant finding of I.T.A.T. is reproduced as under :- "On consideration of the rival submissions, w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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